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Deutsche faces $3B Jewish trust lawsuit; Sberbank headcount could halve by 2025

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Deutsche faces $3B Jewish trust lawsuit; Sberbank headcount could halve by 2025

* Dutch finance minister Jeroen Dijsselbloem criticized British Prime Minister Theresa May for wanting to leave the EU single market, saying that in 20 years' time the U.K. would be back to where it was in the 1970s, NRC Handelsblad reports. "Totally outdated, huge unemployment, totally impoverished," he said. "That doesn't look like the model of the future of England to me."

* The EU should abolish all attempts to create a superstate or risk collapse, Dutch Prime Minister Mark Rutte told the World Economic Forum in Davos, Switzerland. Former European Parliament Chairman Martin Schulz argued for a strong union, but Rutte said the idea of a European superstate "is history," Het Financieele Dagblad reports.

* Banco Santander SA President Ana Botín, meanwhile, called for faster European integration, saying the European project had been a success and could reach a real monetary union. According to Expansión, she also reiterated Santander's commitment to the U.K. following Brexit. The lender has a significant presence in Britain following its acquisitions of Abbey National in 2004 and Alliance & Leicester in 2008.

UK AND IRELAND

* Royal Bank of Scotland Group Plc may opt to take a multi-billion dollar provision in its fourth quarter 2016 accounts for a potential settlement with U.S. authorities over mortgage-backed securities, insiders tell Bloomberg News. The bank could base the charge on Deutsche Bank AG's and Credit Suisse Group AG's recent settlements.

* London will remain "the financial lungs for Europe" post-Brexit, according to Barclays Plc CEO Jes Staley. In an interview with the BBC, Staley said the bank might move some activities to Dublin or Germany but that most of its European business should continue to be able to operate from the U.K. Separately, Barclays Chairman John McFarlane said he expects the British government to support a three-year transition period for financial institutions after Brexit, Reuters writes.

* Barclays' Staley told Bloomberg TV that the bank would have completed large-scale job cuts following the closure this year of a noncore unit housing unwanted assets.

* Aon Plc is in "advanced talks" to sell its benefits outsourcing business to private equity firm Clayton Dubilier & Rice LLC, insiders tell Reuters. Clayton Dubilier & Rice submitted a bid of about $4.5 billion earlier in January, edging out a competing bid from Blackstone Group LP.

* Lloyd's of London gained final approval from regulators in India to set up a reinsurance branch in the country.

* Aviva Plc will merge its U.K. insurance businesses as part of an organizational shake-up that will include the departure of David McMillan, its CEO for Europe.

GERMANY, SWITZERLAND AND AUSTRIA

* A Jewish charitable trust has sued Deutsche Bank in the U.S., alleging that it wrongly withheld as much as $3 billion from the heirs to the wealthy Wertheim family, Bloomberg reports. The suit claims the bank refuses to return funds that were initially deposited by the family at what is now Credit Suisse, before the Nazis came to power. The money was later transferred to Deutsche Bank.

* UBS Group AG could move investment bankers to Madrid from London in light of Brexit, a source told Bloomberg News.

* Zurich Insurance Group Ltd. expects to eliminate 240 jobs in Britain following the merger last year of its U.K. life and general insurance businesses into one division, Reuters reports. The affected jobs would mainly be in back office functions.

* Russia's JSC VTB Bank has decided to move its European operations to Frankfurt from Vienna, Die Presse writes, citing Russian media reports. The Vienna office is to remain a credit department for the bank following the consolidation of its European activities this year.

FRANCE AND BENELUX

* The board of Belgian insurer Ethias SA has cleared its interim CEO Benoît Verwilghen of all wrongdoing, De Tijd reports. An internal audit had accused him of possible conflicts of interest in a number of real estate deals. But a probe by consultants PwC done on behalf of the board has concluded he is "fit and proper."

* Belgian Finance Minister Johan van Overtveldt is to meet with BNP Paribas SA after BNP Paribas Fortis SA was accused by environment and human rights NGOs of investing €18.2 billion in controversial mining projects, L'Echo reports. The NGOs accuse Belgian banks, including Belgian branches of Deutsche Bank, ING Groep NV and KBC Group NV of investing a total of €34 billion over the last five years in mining projects which they claim flout environmental and human rights laws.

* A former BNP Paribas manager, Dominique Remy, sacked after the bank paid an $8.9 billion fine in the U.S. for breaking sanctions, is claiming €6 million in damages, claiming he was unfairly treated because his bosses were allowed to retire with honor, l'Express reports.

SPAIN AND PORTUGAL

* Millennium BCP has officially launched its €1.33 billion share sale, with the operation running until Feb. 2, Observador says. Meanwhile the Portuguese securities commission has blocked the short selling of BCP shares for today, after the share price dropped yesterday, Economia Online writes.

ITALY AND GREECE

* Shares of Banca Monte dei Paschi di Siena SpA will be readmitted to trading on the Milan stock exchange only after the presentation of a new industrial plan in February, MF reports, citing market regulator Consob.

* Unione di Banche Italiane SpA plans to carry out a cash call needed to buy three bailed-out banks by end June, writes Reuters, citing CEO Victor Massiah.

* Struggling Banca Popolare di Vicenza SpA and Veneto Banca SpA are set to present a plan for their proposed merger to the ECB in early February, says MF. It will include cost-cutting measures, a capital increase of more than €2 billion and the securitization of some €8 billion in nonperforming loans. Meanwhile the ECB gave its approval for Italian state guarantees for bonds of the two lenders, says Il Sole 24 Ore.

* Bank of Cyprus Public Co. Ltd. said it has transferred its listing to the London stock market from Athens. CEO John Hourican said the board's view is that the City of London is the right place for the bank's stock, The Daily Telegraph reports.

* Attica Bank SA has submitted a new restructuring plan to the European Commission for review. Sources told Kathimerini that the plan includes reducing the size of the bank's balance sheet by 22% by the end of 2019, reducing the investment portfolio and cutting costs.

NORDIC COUNTRIES

* Swedbank AB (publ) is under investigation in Lithuania on suspicion of engaging in anti-competitive practices, Reuters reports, citing the country's competition watchdog.

* Tryg A/S today reported fourth-quarter 2016 profit after tax of 560 million Danish kroner, down from 754 million kroner a year earlier. The technical result declined on a yearly basis to 314 million kroner from 522 million kroner.

EASTERN EUROPE

* PAO Sberbank of Russia CEO Herman Gref said bank's employee headcount could fall by 50% by 2025, thanks to the planned digital transformation of the lender, Vedomosti and Kommersant report. Sberbank currently employs about 330,000 people.

* A Russian district court approved the arrest of Dmitry Merkulov, previously vice president at FCRB Bank LLC, formerly known as First Czech-Russian Bank, who is accused of stealing more than 2 billion Russian rubles' worth of assets from the bank, Kommersant says.

* Slovenia wants to sell Abanka d.d. in 2017, rather than by mid-2019 as previously planned, Reuters reported, citing the Slovenian Sovereign Holding.

* Poland's Bank Millennium SA will postpone the publication of its 2016 financial results to March 6 from Feb. 28, and will not publish preliminary results that were expected on Jan. 31, Rzeczpospolita says. The delay is connected to the planned issuance of shares by Portuguese parent company Millennium BCP and its transaction with China's Fosun.

IN OTHER PARTS OF THE WORLD

Asia-Pacific: Indonesia holds benchmark rate; Lloyd's India branch gets regulatory nod

Middle East & Africa: More banks report Q4'16 results; Saudi Arabia cash crunch over?

Latin America: Zurich Brasil merges insurance segments; S&P affirms Colombia

North America: Signature Bank ups provision by 33%; BB&T records penny hit to EPS from M&A

NOW FEATURED ON S&P GLOBAL MARKET INTELLIGENCE

Hedge funds, failing to shine, are forced to lower fees: Hedge funds, facing their largest outflows since the financial crisis, have largely abandoned their traditional "2 and 20" fee structure.

Le Pen victory would mean increased state intervention in French banking: A victory by Marine Le Pen, leader of France's National Front, in France's presidential elections would shake up the banking sector, possibly bringing it back to the days when the state controlled lenders.

Ben Meggeson, Ed Meza, Danielle Rossingh, Gerard O'Dwyer, Beata Fojcik, Mike Hatzidakis, Ali Kayalar, Heather O'Brian, Brian McCulloch, Praxilla Trabattoni and Mariana Aldano contributed to this report.

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